KATHMANDU:
South Asian consumers stand to gain hugely from enhanced
intra-regional trade, according to the experts. One of the main
reasons why intra-regional trade in South Asia failed to take

off is
lack of political will in taking the SAFTA negotiations to the next
stage, said secretary general of CUTS International Pradeep Mehta,
speaking on the importance of the summit of South Asian leaders.
“The annual savings of consumers could be as much as $2 billion,”
Mehta said, adding that many products with regional trade potential
are still kept out of bounds of the Agreement’s tariff
liberalisation programme for fear of disturbance to domestic
industries from import competition.

According
to a study undertaken by CUTS with support from The Asia Foundation
and in collaboration with prominent think tanks from five major
South Asian countries, the South Asian Free Trade Agreement (SAFTA)
holds the key to realise this gain.

The SAARC
Summit to be held in Maldives in this week provides a good platform
for South Asian leaders to renew their commitment toward greater
regional integration.

Though
South Asian economies have achieved significant growth in
international trade, expansion of trade relationships has been
mostly with trading blocs outside the region.

There are
many product categories in which imports are currently sourced by
South Asian countries mainly from Europe, South East Asia and the
Middle East, while they could resort to cheaper imports from
regional trading partners, who have export competence in such
products.

The CUTS
study entitled Cost of Economic Non-Cooperation to Consumers in
South Asia shows that in about 355 excluded products listed by SAFTA
members, there exists very strong prospects for higher regional
trade if preferential tariff rates under the Agreement are applied
to them.